RIYADH: The net assets of licensed endowment investment funds in Saudi Arabia have reached an all-time high of SR1 billion ($266.67 million) in 2024, reflecting a significant 29.3 percent surge from the previous year.
According to the General Authority for Endowments, this substantial growth builds on the 2023 milestone, which exceeded the SR500 million mark. The rise in assets is largely due to the licensing of five additional entities, elevating the total number of endowment investment funds to 34, comprising 27 public and seven private funds.
Endowment funds in the Kingdom are pivotal in fostering sustainable development by offering financial backing for long-term projects that tackle pressing societal needs. These funds are structured to preserve the principal amount while utilizing the earnings to support a range of charitable and developmental endeavors.
This approach guarantees a steady stream of resources for essential sectors such as education, healthcare, infrastructure, and social welfare. In line with Saudi Arabia’s economic development objectives, these endowment funds are Shariah-compliant and are deployed to finance projects that enhance public welfare, including the construction of educational institutions, healthcare initiatives, and infrastructure projects that benefit communities nationwide.
Effective strategic investment management ensures the sustainability of these funds, enabling the endowment to generate continuous revenue for its initiatives while safeguarding the original capital. The Saudi government, through the General Authority for Endowments, has streamlined the licensing and management processes for these funds, promoting transparency and enhancing their contribution to long-term development goals.
These reserves are also subject to regulations by the Capital Market Authority, which oversees the creation of investment products aligned with the country’s broader economic and social progress objectives. By concentrating on sectors like education and healthcare, Saudi Arabia’s endowment funds support the development of human capital, improve the quality of life, and contribute to the realization of Vision 2030, which aims to diversify the economy and reduce reliance on oil.
Additionally, these funds address the increasing demand for infrastructure and social services, particularly in rapidly urbanizing areas such as Riyadh and Jeddah, where population growth necessitates sustainable development solutions.
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